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Former Ross Asset Management investor Hamish McIntosh told the Supreme Court he was entitled to fictitious returns on $500,000 he invested with the failed Ross Asset Management that one judge on the bench said were "a fantasy" based on stolen money.

The Wellington lawyer, representing himself, was yesterday appealing against a Court of Appeal ruling that he must repay the $454,000 in fictitious gains from his investment while keeping his $500,000 principal payment. The liquidators of RAM are cross-appealing that they should be entitled to claw back his principal as well. RAM was New Zealand's biggest-ever Ponzi scheme.

McIntosh has attempted to keep his circumstances private. He lost a bid for name suppression last year. Yesterday the Supreme Court agreed to suppress some parts of his evidence, including details of emails with his banks, architects and to RAM principal David Ross, who had to be nagged to repay the investment ahead of RAM's eventual collapse, as McIntosh tried to get his finances in order to buy a development property in Wellington. However, Justice William Young said the suppression order would be reconsidered in the court's judgment.

He argued that he shouldn't have to repay the $454,000 because the investment had been terminated "in very normal circumstances" and paid out "as if the contract had been fully informed." In public court, McIntosh cited emails to RAM thanking it for "a very good result".

"That's what I rely on to say there was a conclusion or discharge of this contract," he said. The return on his 4 1/2-year investment wasn't so unusual as to trigger alarm bells with his accountants. Anyway, he was entitled to rely on RAM's reports of the returns on the investments, whatever actual use the money had been put to, he said.

"The actual use of the money is irrelevant?" Justice Susan Glazebrook asked to which he replied "yes". Justice Mark O'Regan then said: "But the returns you were told about were a fantasy. Your money was stolen and from then on everything was a fantasy."

Liquidators John Fisk and David Bridgman of PwC took their action against McIntosh as a test case and have previously said they would pursue other investors who pulled out their funds before Ross Asset's collapse. Defrauded investors are expected to receive 3 cents for every dollar invested.

In the High Court, Justice Alan MacKenzie had ruled the liquidator's bid to claw back funds from former Ross investors didn't need an 'all or nothing' approach, and the principal invested could be viewed as separate from the investment scheme's fictitious returns. But in the Supreme Court, McIntosh said it was "completely artificial to bifurcate that amount."

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McIntosh reiterated his argument, unsuccessful in the lower courts, that he had faced a change of circumstances because of a property development on Wellington's Palliser Road, which involved taking on $3 million of debt, pushing the venture into negative equity. Justice MacKenzie in the High Court had dismissed the Wellington investment defence, finding the funds he got from RAM were used to buy a property in Queenstown.

He also reprised the argument from the lower courts there had been a transfer of value in terms of the Companies Act.

Evidence suppressed by the Supreme Court built McIntosh's case that reliance on the RAM money had been a key part of his decision to buy the Wellington property and that by the time RAM was put into liquidation he would have faced an additional loss of funds expended on his development plans.

He also argued that he had no way of knowing, even with the liquidation, whether his portfolio was valid or not.

Lawyers for the liquidators were due to make their counter-appeal yesterday and the decision of the court is expected to be reserved.

Wellington-based Ross built up a private investment service by word of mouth, producing regular reports for shareholders indicating healthy but fictitious returns. Between June 2000 and September 2012, Ross reported false profits of $351 million from fictitious securities trading as part of a fraud that was the largest single such crime committed by an individual in New Zealand. McIntosh today said his broker recommended Ross to him and the investment was accepted by both his accountant and bank.

In June last year, the Court of Appeal turned down a bid by Ross to reduce his 10-year, 10-month jail term, which carries a minimum non-parole period of five years and five months.